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Monday, June 21, 2021

Economic data coming up in the European session

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The ECB will announce its April monetary policy decision today

ECB

Equities roared back in trading yesterday, though US futures are a touch more tepid today, but the Bank of Canada stole the spotlight with the loonie soaring higher as the central bank began their tapering process with a more hawkish tone overall.

It certainly poses an interesting question to other major central banks, particularly the Fed, but don’t expect the ECB to take any steps in the same direction today.

Treasury yields are keeping slightly on the retreat still, with 10-year yields slipping to 1.53% though major currencies are little changed overall and holding in narrow ranges.

EUR/USD keeps at 1.2030 levels in a 15 pips range while USD/JPY is hugging the 108.00 handle still with large option expiries seen around the figure level through to 108.40.

There isn’t much else on the agenda in the session ahead so expect things to be more quiet as risk flows and technicals are still the dominant factors this week. However, we may only see things pick up in US trading once again in the day to come.

0600 GMT – Switzerland March trade balance data

Prior release can be found here. An overview of trade conditions in the Swiss economy, which are still slowly progressing towards pre-virus levels as a trend. A minor data point.

0645 GMT – France April business confidence

Prior release can be found here. French business morale is expected to hold thereabouts as overall economic sentiment remains little changed from March to April, though there is still some hope and optimism that things will get better in 2H 2021.

1000 GMT – UK April CBI trends total orders, selling prices

Prior release can be found here. The CBI readings are a survey on manufacturers to rate the level of volume for orders expected during the next 3 months.

1145 GMT – ECB announces its April monetary policy decision

The March meeting statement can be found here. At the time, the ECB pledged to step up PEPP purchases “significantly” but from the data over the past month or so, there hasn’t been much evidence of that – yet policymakers are already talking about tapering. They did warn it may take months for the purchases to show up on the data, so we’ll see. As such, don’t expect much change on their policy language this time around. The views on the economy, inflation and rates should be consistent with what we saw in March. I doubt they will tee up the possibility of a more optimistic and stronger tone in June considering the virus situation but that would be the only real surprise if anything else. Otherwise, expect a non-event.

That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.



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